]]>By: Proud Rinohttp://hotair.com/archives/2010/08/19/oh-my-new-lefty-obamacare-message-drops-promise-of-cost-cutting-vows-to-improve-law/comment-page-3/#comment-3818517
Fri, 20 Aug 2010 18:16:46 +0000http://hotair.com/?p=104508#comment-3818517Yes you are. You want to renew the Bush tax cuts in the face of a massive deficit. Cutting taxes to spur growth in times of recession is as Keynesian as stimulus spending. A lot of the stimulus spending was tax breaks anyway. We haven’t had a non-Keynesian President since at least Hoover. Let’s just be honest about the debate we’re having, which is whether spending is as good as tax cuts.

Banks don’t do high risk things unless they have a safety net. They don’t buy up high risk derivative funds unless there is a safety net.

And yet…here we are.

1) A promise from their Congress critters to bail them out

Ask Lehman Bros. how that worked out for them. The only “promise” they had, if you can even call it that, was that everyone was involved. Goldman Sachs and Co. had to know that even if the doomsday predictors were right, they just weren’t going to let this happen.

2) A promise that Fannie and Freddie would underwrite the mortgages. And then F and F started actually pulling the high risk stuff off the banks’ books because they saw the writing on the wall as all those adjustable “liar loans” were changing to 7, 8, 9%.

Freddie and Fannie had automated underwiting which was insufficient to prevent a catastrophe. But no one was forced to make those loans, and no one was forced to to create CDOs based on those loans, nor was anyone forced to make subprime mortgages pretty much the only way i-banks were making money in the mid-00s.

No, lots of banks weren’t “forced.”

Right…

But Obama himself bragged that as a lawyer in Chicago he worked with the DoJ on a “redlining” case, liberal speak for “a bank wouldn’t do a high risk loan.”

No.

ACORN packed bank lobbies and shut them down for the day if they wouldn’t do high risk loans.

Not buying it. I’m just not buying “ACORN was shutting down the banks and forcing them to make risky loans.” Even if that were true, still doesn’t making high risk CDOs and it doesn’t excuse Moody and S&P and it doesn’t excuse i-banks for staking their entire business on whether some idiot working the register at Wal-Mart could pay off his $750k home.

And we did for the banks exactly what we promised: we bailed them out for participating in all this chicanery. And despite Bush warning 23 times beginning in 2001 that the high risk lending would cause an asset bubble and crush the economy, Obama and his MSM minions will continue to blame him for allowing it to happen.

I agree that Bush gets unfairly blamed. I don’t know where you’re getting this magical promise, but I’m sure it’s news the tumbleweeds at Lehman Bros.

Yes, Democrats and Republicans are both at fault, especially in Congress, for not stopping the madness. It was RINO Grahamnesty that helped repeal Glass-Steagal and allow banks to ALSO be investment houses and put their customers at risk. But Clinton pushed it through and signed it.

It was Phil Gramm’s bill, not Lindsey Graham’s. Gotta be kidding me. And it was a pretty straight party line vote, let’s not pretend that the fact that Clinton signed it means that the left endorsed repealing Glass Steagall.

And blaming Democrats and/or Republicans is one of the problems. When gigantic economic catastrophes happen, it’s everyone and no one’s fault, in the sense that everyone contributed, but there was no specific, one thing that happened that caused the entire catastrophe to occur. That’s sort of my point.

The problem was not that there was too much regulation or not enough regulation, but that there wasn’t the right kind of regulation. If you’re saying things like “ACORN caused this,” or “Bush caused that,” then you don’t know what you’re talking about.

Yes, Democrats and Republicans are both at fault, especially in Congress, for not stopping the madness. It was RINO Grahamnesty that helped repeal Glass-Steagal and allow banks to ALSO be investment houses and put their customers at risk. But Clinton pushed it through and signed it.

The crisis started back in the 90’s with the CRA. The issues with fannie and freddie that started between 200 and 2007 pushed by your lib friends put us in this mess.

You referred to the folks at Business week as commies, which I found kinda harsh, so I researched the guy who wrote the opinion article you linked to.

But OK, let’s just say that that’s what happened with the CRA, and the banks *had* to give out these loans, even though that didn’t happen. Doesn’t explain what happened in the bond markets, does it? How did Barney Frank do that?

Still, banks didn’t start to collapse until 2007. That’s what I meant. I’m glad you focused on the date of when the crisis started and whether Aaron Pressman is or isn’t a liberal instead of the questions I raised. That kinda says it all, doesn’t it.

Proud Rino on August 20, 2010 at 12:06 PM

Banks don’t do high risk things unless they have a safety net. They don’t buy up high risk derivative funds unless there is a safety net.

They had two safety nets:
1) A promise from their Congress critters to bail them out
2) A promise that Fannie and Freddie would underwrite the mortgages. And then F and F started actually pulling the high risk stuff off the banks’ books because they saw the writing on the wall as all those adjustable “liar loans” were changing to 7, 8, 9%.

No, lots of banks weren’t “forced.” But Obama himself bragged that as a lawyer in Chicago he worked with the DoJ on a “redlining” case, liberal speak for “a bank wouldn’t do a high risk loan.” ACORN packed bank lobbies and shut them down for the day if they wouldn’t do high risk loans. Fannie and Freddie changed their underwriting standards.

And we did for the banks exactly what we promised: we bailed them out for participating in all this chicanery. And despite Bush warning 23 times beginning in 2001 that the high risk lending would cause an asset bubble and crush the economy, Obama and his MSM minions will continue to blame him for allowing it to happen.

Yes, Democrats and Republicans are both at fault, especially in Congress, for not stopping the madness. It was RINO Grahamnesty that helped repeal Glass-Steagal and allow banks to ALSO be investment houses and put their customers at risk. But Clinton pushed it through and signed it.

Still, banks didn’t start to collapse until 2007. That’s what I meant. I’m glad you focused on the date of when the crisis started and whether Aaron Pressman is or isn’t a liberal instead of the questions I raised. That kinda says it all, doesn’t it.

But no global financial crisis (at least not one related to the housing market) until 2007.

Fannie and Freddie started buying up and bundling mortgages in 2005

FTA:

The decline in underwriting standards is clear in the financial disclosures of Fannie and Freddie. From 2005 to 2007, Fannie and Freddie bought approximately $1 trillion in subprime and Alt-A loans, amounting to about 40 percent of their mortgage purchases during that period.

As to your links – if you actually read the whole article in the first link, it makes a lot of my points for me, it’s just that the final conclusion does not follow from the facts. He blames everything on the feds, and then talks about state laws, global laws, and “declines in underwriting standards,” and he just passes those things off like those things were as natural as a summer rain. Furthermore, he says that fed regs created incentives to create a bubble – and that might be true. We’ve had a few housing bubbles since the CRA existed.

But no global financial crisis (at least not one related to the housing market) until 2007. Why? What changed in the CRA that made this time different?

Your second link is some partisan BS. Real sources are better. Stick with those.

]]>By: Proud Rinohttp://hotair.com/archives/2010/08/19/oh-my-new-lefty-obamacare-message-drops-promise-of-cost-cutting-vows-to-improve-law/comment-page-3/#comment-3817996
Fri, 20 Aug 2010 15:12:32 +0000http://hotair.com/?p=104508#comment-3817996You know what’s interesting – if the banks were really doing all this stuff against their will, and they’d been doing so for the past 35 years, why didn’t they ever kick up a fuss about it until now?

Maybe it’s because investment banks don’t have any political power, and that, obviously, explains why we essentially wrote them blank checks in 2008 so that they wouldn’t collapse the entire world economy.

Lest we forget ACORN going into banks, literally pressuring banks to make riskly loans, because they knew they could. Banks were forced to do this, against standard banking procedures, and common sense. Would you loan money to a friend, knowing they were a high risk at paying it back? I doubt it!

capejasmine on August 20, 2010 at 10:57 AM

Wait a second, ACORN? Are you freaking kidding me? ACORN was brought down by some idiot with a camcorder, and you’re telling me that they were pushing Bear Stearns around?

You say banks were forced “to do this.” Well, what is “this,” exactly? Because the housing crisis itself is really secondary to what happened in the bond markets, and that’s what caused the collapse in i-banking and very nearly the collapse of the global economy as we knew it.

If these were just a bunch of bad loans, all that happens is that the banks get the houses back. If the houses are devalued, then they lose some money, but hey, who’s fault is it that the banks gave them all that money? CRA didn’t require that banks give loans to people without income verification or give them unlimited amounts of money. Find the provision in the law which says that it did, because that’d be news to me too.

But OK, let’s just say that that’s what happened with the CRA, and the banks *had* to give out these loans, even though that didn’t happen. Doesn’t explain what happened in the bond markets, does it? How did Barney Frank do that?

]]>By: capejasminehttp://hotair.com/archives/2010/08/19/oh-my-new-lefty-obamacare-message-drops-promise-of-cost-cutting-vows-to-improve-law/comment-page-3/#comment-3817938
Fri, 20 Aug 2010 14:58:33 +0000http://hotair.com/?p=104508#comment-3817938Well, the proof is out there now. The Dimwits passed this debacle, and for now, we’re stuck with it. Now, they admit it’s a failure, and needs a lot of work. Yet some here, still refuse to see the truth.

Hang on to that hope and change folks. It’s pretty much all you’ll have left come next year.

Sure is! CRA was legislation, aka LAW! Lest we forget ACORN going into banks, literally pressuring banks to make riskly loans, because they knew they could. Banks were forced to do this, against standard banking procedures, and common sense. Would you loan money to a friend, knowing they were a high risk at paying it back? I doubt it!

Jan 4, 1994
Janet Reno
“No loan is exempt, no bank is immune,” warned then-Attorney General Janet Reno. “For those who thumb their nose at us, I promise vigorous enforcement.”

Well, this one quote, taken completely devoid of any context, really shows the error of my ways.

Here’s a question: Why didn’t the people who were forced, according to you, to make these loans and then forced, somehow, to turn them into ABSs and then forced to present them dishonestly to Moody’s and then forced to overleverage their firms so that they were totally dependent on loans from millions of people who couldn’t possibly pay those loans – which they were well aware of, since they didn’t want to do it and were being forced to – why didn’t they purchase credit default swaps (which, by the way, they sold, willingly) to groups like Scion Capital? Wouldn’t that have at least protected their investments? Wouldn’t that have prevented them from collapsing or needing to get bailed out? I thought they didn’t commit suicide, right? So answer that question and then we can start really getting into the details here.

That’s right, somehow Barney Frank and Janet Reno forced all the banks to give people terrible loans. That’s exactly what happened. Don’t you remember the banks complaining about this on a regular basis? They were saying, “Gosh, we sure don’t want to give these people loans, but since a Congressman is somehow forcing us to

Wowow Double down on your ignorance Rino. Yes, Janet Reno threatened to “investigate” (persecute) lenders who didn’t buckle under to the CRA. And yeah, the banks complained, threw up their hands and lent tons of money to people who had no hope of paying it back, rather than face the DoJ.

Jan 4, 1994
Janet Reno
“No loan is exempt, no bank is immune,” warned then-Attorney General Janet Reno. “For those who thumb their nose at us, I promise vigorous enforcement.”

But this all happened before you were born it seems.

Uh … you’re not aware that Fannie and Freddie bought all those loans and bundled them for sale around the world?

If Fannie and Freddie hadn’t existed, the housing bubble never would have happened, or popped.

Here’s a tip: Businesses unencumbered by government regulation and coercion typically don’t want to commit suicide.

That’s right … people have absolutely no responsibility. They’re stupid, they sign anything. Why should they apply for a home loan knowing full well they can’t afford it? And those mean old lending institutions … no, they weren’t coereced to give people these loans, no, not at all.

darwin on August 20, 2010 at 8:44 AM

Interesting that you’re only concerned with the personal responsibility of the consumers who bought houses they couldn’t afford, and not the personal responsibility of the banks who gave them loans without credit checks or income verification. Those people are to blame, but so are the banks. Bank of America wasn’t forced to give people terrible loans without researching whether or not those people had a remote chance of paying off that loan, and Lehman Bros and Bear Stearns weren’t forced to bundle those mortgages into ABSs and then not have any idea what was in those securities, and then basically put all their money into the subprime market.